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The Annual Return on Foreign Liabilities and Assets (FLA) is a mandatory submission for Indian entities that have received Foreign Direct Investment (FDI) or made Overseas Direct Investment (ODI) in current or previous years, and hold foreign assets or liabilities on their balance sheets as of March 31. This includes companies registered under the Companies Act, 2013, Limited Liability Partnerships (LLPs), SEBI-registered Alternative Investment Funds (AIFs), Partnership Firms, and Public Private Partnerships (PPPs). Even if an entity didn’t receive new FDI or make new ODI in the current financial year but holds existing FDI/ODI, the FLA return is still required. However, entities with only External Commercial Borrowings or Foreign Portfolio Investments (as these are not classified as FDI) are not required to file the FLA. You can submit the return based on provisional financials, but if there are significant changes in audited financials, a revised FLA should be filed. For technical issues or changes in CIN or email ID registered on the FLAIR portal, contact surveyfla@rbi.org.in for assistance. When a listed company has NRI investors, their shareholdings, if classified as FDI, must be reported based on whether they hold less than or more than 10% of the shares.

FAQ’s on Annual Return on Foreign Liabilities and Assets (FLA)

1. Which entities are required to submit the FLA Return?

The annual return on Foreign Liabilities and Assets (FLA) is required to be submitted by the following entities which have received FDI (foreign direct investment) and/or made FDI abroad (i.e. overseas investment) in the previous year(s) including the current year i.e. who holds foreign assets or/and liabilities in their balance sheets;

  • A Company within the meaning of section 1(4) of the Companies Act, 2013.
  • A Limited Liability Partnership (LLP) registered under the Limited Liability Partnership Act, 2008
  • Others [include SEBI registered Alternative Investment Funds (AIFs), Partnership Firms, Public Private Partnerships (PPP) etc.]

[Source: FAQ’s published by Department of Statistics and Information Management, RBI]

2. The Company has not received any Foreign Direct Investment or Overseas Direct Investment in the current financial year, is the Company required to submit FLA?

Yes, an entity which has received FDI or made ODI in the current or previous year and has FDI/ ODI as on 31st March of the relevant year shall be required to file FLA.

3. The Company does not have FDI/ ODI and has availed External Commercial Borrowing, is the Company required to submit FLA?

No, the Company shall not be required to file FLA in case there is no FDI/ ODI in the Company.

4. Whether the entity submitting Annual Return on Foreign Liabilities and Assets (FLA) are required to submit financial statements on FLAIR portal?

No, entity submitting Annual Return on Foreign Assets and Liabilities may file the return on the basis of audited/ provisional financials, there is no requirement of provision for attachment of financial statement to the form.

5. How to change the CIN, e mail ID registered on FLAIR portal?

There is no provision for change in e mail, CIN registerd on flair portal. In case of change in name of the Company, registered CIN or e mail ID, send an e mail to surveyfla@rbi.org.in for deactivation of existing user and post de activation, register with updated details.

6. An entity has only Foreign portfolio Investment, is it required to submit FLA?

No, an entity shall be required to submit FLA if there is Foreign Direct Investment or Overseas Direct Investment, since Foreign Portfolio Investment is not classified as FDI, a Company having only Foreign Portfolio Investment as on 31st March of the relevant year shall not be required to file FLA.

7. In case of a listed Company, there are multiple NRI investors, where should the investment held by NRIs be reported in FLA?

In case of shares held by NRI investors are under FDI, the same needs to be classified into less than and more than 10% holding and reported in Point 1.b or 2.b of Sec III of the Form.

8. How do I resolve any technical issues faced while filing the Form?

Any technical issues faced while filing the form, shall be addressed to surveyfla@rbi.org.in

9. The FLA was submitted based on provisional financials. Now there is a change in the audited financials. What should be done?

 FLA can be submitted on the basis of provisional numbers as on the due date. However, in case of variation between the provisional and final numbers, FLA should be revised as per the audited financial statements.

For detailed instructions on the revision process, please refer to Questions 70 and 71 in the FAQs published by RBI on the FIRMS portal.

For FAQ’s on FLA, published by Reserve Bank of India please refer https://flair.rbi.org.in/fla/faces/pages/login.xhtml

***

Above FAQs are written  by Ridhi Gada, Manager 

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